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Date : Jun 29, 2018
India’s External Debt as at the end of March 2018

As per the standard practice, India's external debt statistics for the quarters ending March and June are released by the Reserve Bank of India with a lag of one quarter and those for the quarters ending September and December by the Ministry of Finance, Government of India. The external debt data as at end-March 2018 in rupees and US dollars as well as revised data for earlier quarters are set out in Statements 1 and 2, respectively. The major developments relating to India’s external debt as at end-March 2018 are presented below.

Highlights

At end-March 2018, India’s external debt witnessed an increase of 12.4 per cent over its level at end-March 2017, primarily on account of an increase in commercial borrowings, short-term debt and non-resident Indian (NRI) deposits. The increase in the magnitude of external debt was partly due to valuation loss resulting from the depreciation of the US dollar against major currencies. The external debt to GDP ratio stood at 20.5 per cent at end-March 2018, higher than its level of 20.0 per cent at end-March 2017.

Major highlights pertaining to India’s external debt at end-March 2018 are presented below:

  • At end-March 2018, India’s external debt was placed at US$ 529.7 billion, recording an increase of US$ 58.4 billion over its level at end-March 2017 (Table 1).

  • Valuation loss due to the depreciation of the US dollar vis-à-vis major currencies (viz., euro, SDR, Japanese yen and pound sterling) was placed at US$ 5.2 billion. Excluding the valuation effect, the increase in external debt would have been US$ 53.1 billion instead of US$ 58.4 billion at end-March 2018 over end-March 2017.

  • Commercial borrowings continued to be the largest component of external debt with a share of 38.2 per cent, followed by NRI deposits (23.8 per cent) and short-term trade credit (19.0 per cent).

  • At end-March 2018, long-term debt (with original maturity of above one year) was placed at US$ 427.5 billion, recording an increase of US$ 44.3 billion over its level at end-March 2017.

  • The share of long-term debt (original maturity) in total external debt at end-March 2018 was 80.7 per cent, lower than its level of 81.3 per cent at end-March 2017.

  • The share of short-term debt (with original maturity of up to one year) in total external debt increased to 19.3 per cent at end-March 2018 from 18.7 per cent at end-March 2017. The ratio of short-term debt (original maturity) to foreign exchange reserves increased to 24.1 per cent at end-March 2018 (23.8 per cent at end-March 2017).

  • Short-term debt on a residual maturity basis (i.e., debt obligations that include long-term debt by original maturity falling due over the next twelve months and short-term debt by original maturity) constituted 42.0 per cent of total external debt at end-March 2018 (41.6 per cent at end-March 2017) and stood at 52.3 per cent of foreign exchange reserves (53.0 per cent at end-March 2017) (Table 2).

  • US dollar denominated debt continued to be the largest component of India’s external debt with a share of 49.5 per cent at end-March 2018, followed by the Indian rupee (35.8 per cent), SDR (5.5 per cent), Japanese yen (4.8 per cent) and euro (3.4 per cent).

  • The borrower-wise classification shows that the outstanding debt of both government and non-government sectors increased at end-March 2018 (Table 3).

  • Debt service payments declined to 7.5 per cent of current receipts at end-March 2018 as compared with 8.3 per cent at end-March 2017 (Table 4).

Ajit Prasad
Assistant Adviser

Press Release : 2017-2018/3418


Table 1: External Debt - Outstanding and Variation
(US$ billion)
Component Outstanding at end-March Absolute variation Percentage variation
2016 R 2017 PR 2018 P Mar-17 over Mar-16 Mar-18 over Mar-17 Mar-17 over Mar-16 Mar-18 over Mar-17
1 2 3 4 5 6 7 8
1. Multilateral 54.0 54.5 57.3 0.5 2.8 0.9 5.1
2. Bilateral 22.4 23.2 25.3 0.8 2.1 3.4 9.2
3. IMF 5.6 5.4 5.8 -0.2 0.4 -3.5 6.9
4. Trade Credit 10.5 9.6 9.4 -0.9 -0.2 -8.9 -1.7
5.Commercial Borrowings 180.5 172.4 202.3 -8.1 29.9 -4.5 17.4
6. NRI Deposits 126.9 116.9 126.2 -10.1 9.3 -7.9 8.0
7. Rupee Debt 1.3 1.2 1.2 -0.1 0.0 -3.9 -1.2
8. Short-term Debt# 83.5 88.1 102.2 4.6 14.0 5.5 15.9
    Of which              
    Short-term Trade Credit 80.0 86.5 100.4 6.5 13.9 8.1 16.1
Total Debt 484.8 471.3 529.7 -13.5 58.4 -2.8 12.4
Memo Items:              
A. Long-term Debt (original maturity)@ 401.3 383.2 427.5 -18.1 44.3 -4.5 11.6
B. Short-term Debt (original maturity)# 83.5 88.1 102.2 4.6 14.0 5.5 15.9
R: Revised. PR: Partially Revised. P: Provisional.
@: Debt with original maturity of above one year.
#: Debt with original maturity of up to one year.

Table 2: Residual Maturity of External Debt Outstanding at End-March 2018
(US$ billion)
Component Short-term up to one year** Long-term Total (2 to 5)
1 to 2 years 2 to 3 years More than 3 years
1 2 3 4 5 6
1. Sovereign Debt (long-term)$ 5.0 7.9 8.3 90.4 111.7
2. Commercial Borrowings # 25.9 20.8 25.6 117.4 189.7
3. NRI Deposits {(i)+(ii)+(iii)} 89.1 16.7 9.7 10.7 126.2
    (i) FCNR(B) 14.9 3.9 1.8 1.5 22.0
    (ii) NR(E)RA 62.0 11.7 7.4 8.9 90.0
    (iii) NRO 12.2 1.0 0.6 0.3 14.1
4. Short-term Debt* (original maturity) 102.2       102.2
Total (1 to 4) 222.2 45.4 43.6 218.5 529.7
Memo Items:          
Short-term Debt (residual maturity) as per cent of Total External Debt 42.0
Short-term Debt (residual maturity) as per cent of Reserves 52.3
$: Inclusive of FPI Investments in government securities.
#: Commercial borrowings are inclusive of trade credit, FPI investments in corporate debt instruments and a portion of non-government multilateral and bilateral borrowings and therefore may not tally with the figures provided in other tables under original maturity.
*: Also includes FPI investments in security receipts issued by Asset Reconstruction Companies (ARCs) under the extant Corporate Debt Limits.
**: Short-term debt by residual maturity comprise long-term debt by original maturity falling due over the next twelve months and short-term debt by original maturity.

Table 3: Government and Non-Government External Debt
(US$ billion)
Component End-March
2015 2016 R 2017 PR 2018 P
1 2 3 4 5
A. Sovereign Debt (I+II) 89.7 93.6 95.9 111.9
As a percentage of GDP 4.5 4.5 4.1 4.3
I. External Debt on Government Account under External Assistance 58.5 61.1 62.8 68.6
II. Other Government External Debt@ 31.3 32.5 33.1 43.4
B. Non-Government Debt # 385.0 391.2 375.4 417.7
As a percentage of GDP 19.4 18.9 16.0 16.2
C. Total External Debt (A+B) 474.7 484.8 471.3 529.7
As a percentage of GDP 23.9 23.4 20.0 20.5
R: Revised. PR: Partially Revised. P: Provisional.        
@: Other government external debt includes defence debt, investment in Treasury Bills/ government securities by FPIs, foreign central banks and international institutions and IMF.
#: Includes external debt of Monetary Authority.

Table 4: India’s Key External Debt Indicators
End-March External Debt
(US$ billion)
Ratio of External Debt to GDP
(Per cent)
Debt Service Ratio
(Per cent)
Ratio of Foreign Exchange Reserves to Total Debt
(Per cent)
Ratio of Concessional Debt to Total Debt
(Per cent)
Ratio of Short-term Debt to Foreign Exchange Reserves
(Per cent)
Ratio of Short-term Debt (original maturity) to Total Debt
(Per cent)
1 2 3 4 5 6 7 8
1991 83.8 28.7 35.3 7.0 45.9 146.5 10.2
1996 93.7 27.0 26.2 23.1 44.7 23.2 5.4
2001 101.3 22.5 16.6 41.7 35.4 8.6 3.6
2006 139.1 16.8 10.1# 109.0 28.4 12.9 14.0
2007 172.4 17.5 4.7 115.6 23.0 14.1 16.3
2008 224.4 18.0 4.8 138.0 19.7 14.8 20.4
2009 224.5 20.3 4.4 112.2 18.7 17.2 19.3
2010 260.9 18.2 5.8 106.9 16.8 18.8 20.1
2011 317.9 18.2 4.4 95.9 14.9 21.3 20.4
2012 360.8 21.1 6.0 81.6 13.3 26.6 21.7
2013 409.4 22.4 5.9 71.3 11.1 33.1 23.6
2014 446.2 23.9 5.9 68.2 10.4 30.1 20.5
2015 474.7 23.9 7.6 72.0 8.8 25.0 18.0
2016 R 484.8 23.4 8.8 74.3 9.0 23.2 17.2
2017 PR 471.3 20.0 8.3 78.5 9.4 23.8 18.7
2018 P 529.7 20.5 7.5 80.2 9.1 24.1 19.3
R: Revised. PR: Partially Revised. P: Provisional.
#: works out to 6.3 per cent with the exclusion of India Millennium Deposits (IMDs) repayments of US$ 7.1 billion and pre-payment of external debt of US$ 23.5 million.

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